When the EU and China agreed in late June to give themselves until October to reset their trade relationship, it looked like rare progress. Three months on, the mood in Brussels is closer to resignation. The deadline still stands — EU Trade Commissioner Maroš Šefčovič is due to fly to Beijing in the autumn to judge whether China has moved — but almost no one now expects it to deliver much.
The framework itself has not changed. Four working groups are meant to tackle the issues that have soured the relationship: rebalancing trade and investment, export controls, intellectual property and reform of the World Trade Organization. A joint monitoring mechanism is supposed to flag destabilising import surges into a "red zone" and escalate them to political talks before they hit European industry. The number driving all of it is a trade deficit that reached €360 billion in 2025 — roughly a billion euros a day — with every one of the 27 member states in the red against Beijing.
What has changed is the confidence that October will produce anything concrete. Bernd Lange, the veteran chair of the European Parliament's trade committee, bluntly called the deadline "not realistic at all." Trade analysts have reached a similar conclusion: the likeliest October outcome is a political framework setting out broad parameters for rebalancing — more transparency, more predictability — rather than the tariff cuts or market openings European exporters actually want.
The reason Europe cannot simply walk away is buried in its supply chains. China dominates the rare earths and permanent magnets that European carmakers, wind-turbine manufacturers and defence firms cannot build without, and a Chinese licensing regime — which forces companies to disclose commercial details to obtain export permits — has left manufacturers rattled. Beijing offers reassurance that supplies will keep flowing; Brussels has heard such reassurances before. In return, China wants Europe to drop its tariffs on Chinese electric vehicles and lift restrictions on advanced chipmaking equipment from the Netherlands' ASML. Neither side is close to conceding.
Even while talking, the Commission has been building leverage. Since 1 July, the EU's overhauled steel safeguards have cut tariff-free import quotas sharply and reserved much of the remaining duty-free room for countries with EU trade deals — leaving China, which has none, facing 50% tariffs on out-of-quota steel. A new handling fee now applies to the billions of low-value parcels shipped from platforms such as Temu and Shein. And two further instruments sit in reserve: one to push companies to diversify away from Chinese suppliers, another to shield any member state hit by Chinese retaliation. Together they form the outline of a plan B.
The obstacle, as ever, is that Europe is not united. Germany, whose carmakers depend on the Chinese market, has pushed a more pragmatic line, and economics minister Katherina Reiche met her Chinese counterparts before the Šefčovič round. As long as the big capitals hedge, the Commission's tougher stance loses force — and Beijing knows it. There is a Washington shadow, too: even as Brussels leans on China, it is fending off President Trump, who has threatened 100% tariffs over European "digital taxes" and is already furious about this week's €890 million EU fine on Google.
Deadlines only work if the party on the other side believes something bad happens when the clock runs out. Brussels has paired its October target with real tools — steel curbs, parcel fees, a monitoring trigger and two trade-defence instruments in the drawer — which is more credible pressure than it has brought to past China talks. But the honest reading, three months out, is that October will most likely produce a framework and a photo, not a rebalanced relationship. If that happens, the question becomes whether the Commission is willing to actually reach for its plan B, or whether a divided Europe once again settles for managing the imbalance rather than closing it. The next hundred days will show which.
